Metabical Case Study

Overview & Proposed Solution Cambridge Science Pharmaceuticals (CSP) came out with the first prescription drug approved by the FDA specifically for overweight individuals called Metabical. It was a unique product, which was focused towards a particular segment of the market, the overweight segment. It was the first of its kind and had that advantage. There were other products, but they were not as popular in the market segment Metabical was targeting. Metabical was to compete in the Prescriptive drug market, where there were only a few drugs available but these drugs were mainly approved for obese and severely obese individuals. The only drug that was approved by the FDA for overweight individuals was Alli. In this report, we will conduct an analysis to determine which of the 3 proposed pricing models will promotes high sales and be profitable to the company at the same time. Based on the various analyses conducted, I will recommend Option 2 to the Cambridge Science Pharmaceuticals organization. The option 2 pricing model (Pricing for a 4 week supply of Metabical at $125) is just right to compete in unique market segments while communicating value of the product and it fits well with the company’s strategy. Support for Solution The second pricing model was chosen for several reasons. One being, that it aligns with CSP’s corporate strategy while the third option shows pricing to be too high as market research indicated. Also, the 2nd pricing structure was chosen because this demographic may look into other methods or products to lose weight. At this pricing, it makes Metabical a premium quality product in line with product effectiveness. Although revenues are lower in the short term,

Metabical will be able to project itself as a premium product over the long term. With the lower pricing structure, it lowers the financial risk to customers. The financial calculations indicate that pricing the product at $125 for a 4-week supply will be ideal as results show a...